2 top Fed officials set plans to resign

Ethics questions raised after disclosures of stock market trading in 2020

WASHINGTON — Robert Kaplan will step down as president of the Federal Reserve Bank of Dallas early next month, the Dallas Fed announced Monday. Kaplan, 64, will become the second senior Fed official to resign after ethics questions were raised this month over their trading activity in the financial markets.

Kaplan’s planned resignation follows a similar announcement earlier Monday by Eric Rosengren, president of the Boston Fed. The two officials’ financial disclosures drew criticism from government watchdogs after they revealed extensive stock trading in 2020, when the Fed was spending trillions of dollars stabilizing financial markets and boosting the economy. Because of their trading, the two officials could have profited from the Fed’s actions.

Though the investments by Rosengren and Kaplan were permitted under the Fed’s rules, they raised at least the appearance of conflicts of interest, which Fed policy discourages.

“The Federal Reserve is approaching a critical point in our economic recovery as it deliberates the future path of monetary policy,” Kaplan said in a statement. “Unfortunately, the recent focus on my financial disclosure risks becoming a distraction.”

Kaplan said he would resign effective Oct. 8.

Kaplan, like all 12 regional Fed bank presidents, is a member of the Federal Reserve’s policymaking committee, with a rotating vote roughly every three years. He did not have a vote this year.

Kaplan is considered a relatively “hawkish” policymaker, meaning that he often favors higher interest rates to counter inflation. He had publicly urged the Fed to quickly begin winding down its monthly purchases of $120 billion in Treasury and mortgage-backed bonds.